China’s winter harvest to yield millions of tonnes of wheat for livestock sector

China’s feed sector has bought record volumes of cheaper wheat from the 2020/21 season for use as a substitute for corn, traditionally the main grain in animal rations

China’s new wheat crop is expected to further dim demand for imports, with a record harvest in 2021 of 136.4 million tonnes predicted

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While China caps low-tariff corn imports at 7.2 million tonnes a season, buyers imported a record 11.29 million tonnes in calendar 2020, mainly from the United States, as high domestic prices made imports economical even when paying tariffs. Photo: Xinhua

Published: 5:18pm, 28 May 2021Updated: 5:18pm, 28 May 2021

China’s massive livestock sector is set to snap up millions of tonnes of wheat from the country’s winter harvest that began this month, extending a run of crop-switching in animal feed while further cooling demand for corn imports.

Corn imports surged last year after a decline in stockpiles and production, pushing up prices and reshaping global grain markets as feed producers and pig farmers scoured the world for supplies.

At the same time, China’s feed sector bought record volumes of cheaper wheat from the 2020/21 season for use as a substitute for corn, which is traditionally the main grain in animal rations.

“Feed demand for wheat is expected to remain very high in the new crop year, as wheat still has obvious advantages against old corn, based on current prices,” said Li Hongchao, a senior analyst with trade website Myagric.com.

We are waiting for the new wheat and will buy whenever there is an opportunity

Purchasing manager

While China caps low-tariff corn imports at 7.2 million tonnes a season, buyers imported a record 11.29 million tonnes in 2020, mainly from the United States, as high domestic prices made imports economical even when paying tariffs.

Feed lots began large-scale wheat substitution from late 2020, effectively easing tight corn supplies and securing domestic feed grain supplies, said Qi Chiming, an analyst with the China National Grain & Oils Information Centre (CNGOIC), an official think tank.

The new wheat crop is expected to further dim demand for imports, with the CNGOIC predicting a record harvest in 2021 of 136.4 million tonnes.

“We are waiting for the new wheat and will buy whenever there is an opportunity,” said a purchasing manager with a major poultry producer in northern China, who declined to be identified as he was not authorised to talk to the media.